TMI Blog2018 (10) TMI 1021X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner of Income Tax (Appeals)-Cental- 1 Kolkata s order dated 03.11.2014, passed in case No.178/CIT(A)C-I/CCXXIV/ 2006-07, in proceedings u/s. 158BD/144 of the Income Tax Act, 1961; in short the Act . Head both the parties. Case file perused. 2. The assessee s sole substantive ground raised at the time of filing challenges the CIT(A) s action affirming assessment findings making sec. 68 of ₹ 3 lac. It has also raised an additional ground in the instant appeal challenging validity of sec. 158BD proceedings for want of necessary satisfaction that the undisclosed income in issue belongs to an assessee other than the searched assessee. Learned counsel quotes hon'ble apex court s judgment as NTPC s case 229 ITR 383 (SC) settling the law that such an additional ground can be raised in tribunal in order to determine credit tax disability in case necessary facts are already on recod. We therefore admit this additional ground raised at assessee s behest. 3. We now advert to CIT(A) s discussion that above legal issue as follows:- 2. In the Memorandum of Appeal, the assessee has contested the impugned order by raising the following grounds: 1. That the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that the factual and legal position in the present case is the same as in the case of M/s S K S Mercantile (P) Ltd. I therefore find that the factual and legal position being the same, the decisions of the Ld CIT(A) C-III, Kolkata in the case of M/s S K S Mercantile (P) Ltd in Appeal No.477/CC-XXIV/CIT(A) C-III/2006-07 Kol are equally applicable in the present appeal. Following the decisions of the Ld CIT(A) C-III, Kolkata in the above case, the addition of ₹ 3,00,000/- made under section 68 is confirmed and that of ₹ 3,000/- on account of commission is deleted. The legal grounds raised by the assessee are dismissed. In effect, ground no 1 to 5 and 7 are dismissed. Ground no 6 is allowed. Ground no 8 being general in nature is dismissed. 4. It is therefore clear that the CIT(A) has followed his order in case of M/s S.K.S. Mercantile (P) Ltd. in affirming the impugned addition. Case file suggests that a co-ordinate bench in M/s S.K.S. Mercantile Pvt. Ltd. vs. ACIT , IT(SS)A No.80/Kol/2013 decided on 13.07.2018 has quashed the similar sec. 158BD proceedings for lack of necessary satisfaction as follows:- 9. We have heard both the parties and perused th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lready been sold during years 1999, 2000 and 2001, so on the date of search the scrip s found and seized does not belong to it. According to the assessee company, when the search happened on 07.05.2000, it had already sold the shares which it had purchased during October and November, 1999 and February, 2000 to the aforesaid four persons for a consideration of Rs.l,21,65,000/-. In connection with amount of Rs.l,21,65,000/- the Ld. AR of the assessee-company drew our attention to the following facts : i. The appellant company had sold its investments in shares of UIC Companies before the date of search on 07.05.2000 and therefore, the seized shares does not belong to it on the date of search. ii. The sale consideration of ₹ 1,21,65,000/- was duly received by the appellant company through Account Payee cheques iii. The cheques received as consideration have been duly deposited in the bank account of the assessee iv. The above-mentioned sale transaction was duly recorded in the books of accounts v. Income Tax Returns incorporating the above details have been duly filed in the relevant assessment year. 11. We note that in the block assessment u/s l58BD/144 wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t hand over the seized books of accounts and other documents and assets on the basis of which satisfaction has been recorded, to the Assessing Officer having jurisdiction over such person other than the searched person. 13. The above view has been taken by the Hon ble Supreme Court in the case of Manish Maheshwari vs ACIT [289 ITR 034].Now the question arises as to whether the above conditions have been fulfilled in the present case also. 14. We note that there was no search warrant in the name of the assessee and it is only on the basis of seized material from the premises of UIC Group which was searched under section 132 of the Act that belongs to the assessee which discloses undisclosed income, then only the case of the assessee could be covered under section l58BD and notice under section l58BD can be validly issued. Therefore, existence of material belonging to assessee must be found during the course of search, which is a sine qua non for taking action under section 158BD of the Act. So, the jurisdictional fact to invoke sec. 158BD against the assessee is the seizure of material belonging to assessee found during search conducted on 07.05.2002. Now the question is, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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